Neoliberalism, the State and the Left

Albo, Gregory, Canadian Dimension

An assessment of the Left today must begin with an analysis of neoliberalism. For over the past two decades neoliberalism has come to dominate public discourse and the modalities of the state in one country after another. The ascendancy of neoliberalism has occurred through a series of interconnected transformations that began with the economic turmoil of the 1970s, the rise of New Right governments across the 1980s, and the deepening internationalization of the circuits of money and industrial capital, modes of communication and governance structures in the 1990s. Neoliberalism has come to mark a historic turning-point in the balance of power, the social forms of economic and political power and the patterns of everyday life.

Neoliberalism is not a monolithic ideology or political program. There is unevenness in the application of the neoliberal project in Canada as elsewhere. The basic idea is that the state should be limited in its role in modern society apart from securing private-property rights and contracts. One of neoliberalism's key ideologues, New York Times correspondent Thomas Friedman, in his book The Lexus and the Olive Tree, exactingly summarizes the agenda:

"A country must either adopt, or be seen as moving toward, the following golden rules: making the private sector the primary engine of its economic growth, maintaining a low rate of inflation and price stability, shrinking the size of its state bureaucracy, maintaining as close to a balanced budget as possible, if not a surplus, eliminating and lowering tariffs on imported goods, removing restrictions on foreign investment, getting rid of quotas and domestic monopolies, increasing exports, privatizing state-owned industries and utilities, deregulating capital markets, making its currency convertible, opening its industries, stock and bond markets to direct foreign ownership and investment, deregulating its economy to promote as much domestic competition as possible, eliminating government corruption, subsidies and kickbacks, opening its banking and telecommunications systems to private ownership and competition, and allowing its citizens to choose from an array of competing pension options and foreign-run pen sion and mutual funds."

Neoliberalism's "golden rules" have the objective of expanding the sphere of the capitalist market globally. But they also are intended to narrow the political and economic choices of those in power" such that. "policy choices get reduced to Pepsi or Coke" -- to slight nuances of taste, slight nuances of policy, slight alterations in design to account for local traditions, but never any major deviations from the core golden rules.

NEOLIBERALISM AND THE STATE

Neoliberalism developed out of an important shift in the balance of class forces and the defeat of the Left, and in particular social democracy. The economic turmoil of the 1 970s initially met with diverse responses across the capitalist countries. One set came from the social-democratic Left in the form of the Common Program in France, the Historic Compromise in Italy, the Bennite Left and local socialism in Britain, the Meidner Plan in Sweden, and progressive legislation in North America like the Humphrey-Hawkins Full Employment Bill and the National Energy Program. (In the less economically advanced zones, revolution was in the air from Portugal and Mozambique to Nicaragua.) These projects varied significantly. But they had in common an attempt at reflation, widening workplace participation, managed trade for the open sector, and "Keynesplus" strategies for increasing social control over aspects of investment previously left to the unilateral suzerainty of capitalists.

These projects all met, in an equally varied manner, political defeat. In the most contested cases of France and Sweden in the 1980s, where the Left could be said to be strongest, the defeats came in the form of capital strikes that destabilized international payments and the economy. …

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